Corporate Venturing

Catégorie

Finance

How to Build a Cash Culture for M&A Optimal Execution

Cash is king, once everyone in the new company understands that the newly formed company will be focused on cash, the other workstreams will collaborate to identify synergies and better manage interdependencies. It is key to instill a “cash culture”early in the process.

Change management is amplified when you’ve done the work to build the “cash culture”. Leaders who coach their team members with a growth-oriented system are able to ignite, align and involve a team that is fully committed to executing a strategic plan.

As you’re preparing for a new year of post acquisition plan execution, trade sales or carvouts, you may be wondering what comes next? You have your plan. It’s structured so all of your initiatives and workstreams are aligned to your organization’s goals, mission and vision. Now, how can you ensure your team is optimized to execute your plan for the greatest results?

Coaching systems that prime professionals for effective execution combine enhanced employee engagement with a relentless focus on goals to drive high performance.

With a deliberate choice to particularly focus on maximising treasury actions and sales massive actions from Day 1, we have developped a unique approach, that works.

We will outline the steps to take when implementing a coaching system to guide your employees through post acquisition or post carve-out plan execution, and boost employee engagement for better results.

You will learn:

The characteristics of the cash culture, constraints and opportunities

How to overcome major obstacles managers face in driving brilliant post acquisition execution

Steps to build your cash culture for better results, increase controls, and set up the right KPIs

Share Purchase Agreement, what is its timing, intention and what are main clauses

Fiscal optimisation for all parties involved: this plays a key role in many transactions.

Tip #5 – Would hiring a professional negotiator make a big difference ?

There are many advanced negotiations tactics, to chose from, which ones have you used ? which ones have worked ? Which ones have you seen being used ?

Tip #6 – Who will be around the negotiating table ?

Who will not be there but will be influential in other ways ? Always useful to keep in mind your list of stakeholders and to manage your counterparties proactively: shareholders, investment banker, lawyer office and buyer. They are usually somehow in the game.

Tip #7 – Valuation of your startup – No one else knows your startup better than you. So roll your own and be well prepared.

Have your own way to do the startup valuation. Get some advise of course.

We all know that all brides look sexy. The seller is always looking good. We will find it difficult to know all the hidden problems and to be 100% sure about the intention of buyers and sellers. It is part of the pocker game and the negotiation preparation.

I know how much money I can get but what will they gain?

How do you chose your lawyers ? They are probably your most expensive friends. What can you prepare without them ? Where can you save a couple of hours of their time ? Where do they truly add value ?

Does the company need a CFO, a CEO, or some kind of CxO ad interim for managing the transition and the acquisition integration ?

How to accelerate if you have to ? The buyer is ready and wants to move fast. You are half ready to sell but unsure you are not missing a unique exit opportunity. How do you deal with that.

CONCLUSION

Better safe than sorry, it is super important to have the right team around you to manage your exit and to be well prepared before you reach the negotiation tables. Startups need to build a growth plan and exit path early in their life cycle to unlock the value created and to maximize the chances of their founders and investors making financial returns.

We would like to hear from you, how did it go for you ?

If any of this is useful, please comment, we would like to hear from you.

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Following persistent rumours about Paypal Holdings Inc, being a potential acquisition target, its share price is expected to jump from 37,07 $ to 50 $ in the next 30-60 days.

Paypal has split from eBay and can now be acquired.

MasterCard could make a move in the coming weeks and is said to be in advanced negotiation stage to offer 50 dollars per share. (Paypal valuation would therefore be 61 billion $). With 1.3 billion cards in circulation, MasterCard remains confronted with very strong competitor (VISA), who have made lots of strong investment recently.

Such an acquisition would enable MasterCard to make a big jump in the payment services, e-commerce services (Alibaba, Amazon and the likes) and to operate some of the largest sharing economy unicorns (AirBnB, Uber…). Merchant services, one of Paypal’s strenghts, would also be a way for MasterCard to acquire a dominant position in a strategic market, where Paypal dominates the world. As this is probably the quickest and easiest way for MasterCard to enter in this highly lucrative market, MasterCard is prepared to pay a substantial premium.